LifeWave Distributors Steven and Gina Merritt Hit with FTC Action Over Income Claims
The Federal Trade Commission announced a settlement in late April 2026 against Steven and Gina Merritt, described by the agency as senior-level participants in LifeWave, over allegations that the couple used deceptive income claims to recruit new participants into the company.
The case is one of three MLM-related enforcement actions the FTC brought in a single month, but the Merritt case stands on its own as a significant development for LifeWave and for the broader distributor community watching how the agency approaches high-level recruiters.
What the FTC Alleged
According to the FTC’s complaint, the Merritts allegedly deceived consumers about the amount of money they could earn from selling LifeWave products and recruiting new participants. FTC Bureau of Consumer Protection Director Christopher Mufarrige stated in the agency’s announcement that the Merritts used inflated earnings claims to entice potential participants when in reality most people did not earn any money.
The FTC did not need outside research to build its case. The agency cited LifeWave’s own published income disclosure statement, which showed that the vast majority of participants earned little or nothing from the business. The gap between what the income disclosure showed and what the Merritts allegedly told prospects was the core of the complaint.
The Terms of the Settlement
Under the settlement order, the Merritts are prohibited from making any representation about earnings that is misleading or that they cannot substantiate in writing at the time the claim is made. If a prospective participant asks for documentation, the Merritts are required to provide written substantiation before that person joins.
The most consequential term of the order is the notification requirement. The Merritts are required to notify their existing downline participants about the FTC’s allegations and about the order’s prohibition on making deceptive and unsubstantiated earnings claims. Being ordered to tell the people in your own organization that you settled FTC income claim allegations is a meaningful consequence that goes well beyond any financial penalty.
What This Means for LifeWave
The FTC’s action targeted the Merritts as individual participants, not LifeWave as a company. That distinction matters legally. LifeWave itself was not named as a defendant in this case, and the settlement order applies specifically to Steven and Gina Merritt’s conduct going forward.
That said, the case puts LifeWave in a complicated position. The company is simultaneously navigating this enforcement action against two of its senior distributors while also dealing with a separate FTC complaint filed the same month against former LifeWave distributor Stormy Wellington over similar income claim allegations at Farmasi and Total Life Changes. The FTC is clearly focused on the income claim practices of high-level MLM recruiters, and LifeWave has now appeared in that enforcement pattern twice in the same month.
For active LifeWave distributors who were not involved in the Merritt case, the practical question is whether the company’s compliance infrastructure is equipped to prevent similar situations from recurring. The notification requirement in the Merritt settlement means a significant portion of the LifeWave field will be receiving a formal communication about FTC allegations in the near term.
The Broader Pattern
The Merritt case did not happen in isolation. The same month the FTC settled with the Merritts, it also took action against Stormy Wellington over income claims at Farmasi and Total Life Changes, and against the operators of Forever Living Products over similar allegations. Three MLM income claim enforcement actions in a single month is not a coincidence. It is a pattern of enforcement activity under existing FTC authority that is proceeding independently of the separate and currently paused rulemaking debate.
The rulemaking pause does not limit the FTC’s ability to bring individual cases under Section 5 of the FTC Act. That authority has existed for decades and these three April 2026 cases are a direct reminder that it is being actively used.
The Lesson That Does Not Change
The income disclosure is the document that matters. In the Merritt case, the Farmasi case, and the Forever Living case, the FTC used the companies’ own published income disclosures to establish the gap between what recruiters were promising and what participants were actually earning.
If your company’s income disclosure shows that most participants earn little or nothing, and you are telling prospects to expect six figures, you are creating a problem. The FTC has made clear it will act on that gap using existing authority, without waiting for new rules to be finalized.
The three April 2026 cases are not a new development in terms of what the law requires. They are a reminder that the agency is actively looking, actively filing, and the income disclosure your company already publishes is the first document it will read.
